Gjensidige Forsikring ASA reported second-quarter pretax profit that surpassed analyst expectations, driven by improved underwriting margins and continued cost discipline that offset a one-off legal charge tied to a Danish court decision.
Pretax profit for the quarter was 2.79 billion crowns, above the average analyst projection of 2.56 billion crowns compiled by the company from 12 estimates. The result also exceeded the highest individual forecast of 2.96 billion crowns cited in the company compilation.
The company’s insurance service result for general insurance reached 2.38 billion crowns, topping the consensus average of 2.12 billion crowns. The combined ratio was reported at 78.9%, better than the consensus average of 81.2% and below the lowest analyst estimate of 80%.
Gjensidige noted that the quarter’s figures included a negative impact on the insurance service result of NOK 419.3 million, net of reserve releases, related to the Danish Supreme Court’s ruling on the reduction in the compensation threshold under the worker’s compensation scheme. The company said this amount was unchanged from the earlier stock exchange announcement on 12 June.
Excluding that one-off impact of NOK 419.3 million (or DKK 290 million), Gjensidige said the insurance service result rose significantly year-on-year, supported by ongoing revenue growth, stronger margins and effective cost control.
Insurance revenue from general insurance was 11.26 billion crowns, essentially in line with the consensus average of 11.24 billion crowns. The underlying frequency loss ratio was 58.5%, materially below the consensus average of 63.7%, a development the company attributed to improvements across both Private and Commercial lines in Norway and Denmark.
The cost ratio was reported at 11.7%, matching the consensus average. Profit after tax from continuing operations stood at 2.12 billion crowns, above the consensus average of 1.95 billion crowns. Earnings per share were 4.18 crowns for the quarter, versus 4.42 crowns a year earlier.
Large losses, net of reinsurance, amounted to 659.6 million crowns, which was higher than the consensus average of 474 million crowns. Run-off gains and losses, net of reinsurance, produced a loss of 297.2 million crowns, compared with analysts’ average estimate of a loss of 184 million crowns.
The group reported a solvency ratio under the approved partial internal model of 188.7%, close to the consensus average of 189%. Annualised return on equity for the year-to-date was 33.3%, up from 31.3% a year earlier.
Gjensidige’s stated financial targets for 2026 include maintaining a combined ratio below 82%, a cost ratio of about 13%, return on equity above 24%, and a solvency ratio in the range of 140-190%.
Implications for markets and sectors
- Insurance sector metrics - particularly underwriting performance and loss ratios - drove the beat, underscoring the sensitivity of P&L outcomes to claims frequency and large losses.
- Financial markets will note the firm’s solvency position and stated 2026 targets as benchmarks for capital adequacy and return expectations within the sector.
- Legal and regulatory developments - in this case a Danish Supreme Court ruling - can produce meaningful one-off impacts on insurer results.